MUMBAI: In a development that could have major ramifications on intellectual property cases in pharmaceutical and technology sectors, the Delhi high court issued a notice to the government on Tuesday in a PIL (public interest litigation) filed by IP expert Shamnad Basheer.

The petition exposes the weak enforcement of an important statutory provision, Form 27, which discloses patent data of a company. It says pharma and technology MNCs are not complying with this law, and are using it to block the entry of affordable versions in the market.

The lack of transparent disclosure will have a detrimental impact on competitors, which will finally affect the public, who are denied access to more affordable technologies, a concern most starkly felt in the context of medicines, the petition says.

Around 35% of the patentees surveyed failed to disclose their patent working status from 2009 to 2012, and other companies filed incomplete or incomprehensible information, the petition says.

Experts say India is perhaps the only country which seeks Form 27 and patent working disclosure from MNCs when they apply for patents, which is an important step to get crucial information to ascertain affordability and availability, particularly in the case of medicines. For instance, in the case of the country’s first compulsory licence, Natco used this data to stake their claim to launch a more affordable version of a life-saving cancer drug, showing MNC firm Bayer’s (Form 27) patent filings where it was supplying the drug to only 2% of the patient population.

Patent working data is critical for triggering compulsory licensing and revocation provisions, and if this trigger is made more difficult by keeping the data secret and opaque, it will ultimately affect consumers by denying them potentially more affordable technologies and goods.

“The statutory mandate to disclose patent working information is meant to foster more transparency in the patent innovation ecosystem. Big Pharma and certain high-tech companies are opposing this, as they use the patent-product nexus as a trade secret, globally”, Basheer told TOI, adding if the company seeks patent monopoly for 20 years, it should give the requisite disclosure of how it is ‘working’ the patent in the country.

The patent working data discloses how the patent has been converted to a product such as a drug, how much of the drug is being sold in the market and at what price (in some cases). Section 146(2) of the Patents Act, 1970 read with Rule 131 of the Patent Rules, 2003 asks every patentee to make an annual disclosure as to how far and to what extent they have commercially worked their patent.

Regarding telecom companies, the petition mentions Swedish MNC Ericsson, which is already embroiled in lawsuits against domestic companies such as Micromax, and refuses to disclose Form 27 as to how it is working their patents, legal experts added.

The survey was conducted in three critical areas: pharmaceutical drugs (lifesaving drugs for fatal diseases such as cancer, AIDS, diabetes and hepatitis); telecommunications; and publicly funded research and development. The petition also points out that despite large scale and blatant violation of this provision, the government has simply failed to take action against errant patentees, despite it being aware of the violation.

The case, represented by counsels Abhimanyu Bhandari and Sai Vinod, was taken up on Tuesday, and an order was passed seeking a reply from the government on its inaction, and to fully enforce patent laws and take action (impose penalties) against errant patentees.

Patent working norms are extremely important as they help demonstrate as to how the public is benefiting from the patent. Patent regimes, the Indian patent regime in particular, are premised on a social bargain, where patentee gains a 20-year monopoly for disclosing valuable scientific/technological information to society, and thereupon, using the patent to presumably build an innovative product to help benefit society.

There is a strong likelihood that some of these omissions are deliberate, with a view to escape public scrutiny of working of patents, the petition says.

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